Directive on Definition of Marginable Securities

Bangladesh Securities and Exchange Commission

DIRECTIVE
Date: April 18, 2023

No. BSEC/CMRRCD/2009-193/57 - Whereas Bangladesh Securities and Exchange Commission (hereinafter referred to as the "Commission") deems it appropriate that in the interest of the investors and for the development of the securities market, certain directions should be issued to the stock exchange(s);

Now, therefore, in exercise of the powers conferred by section 20A of the Securities and Exchange Ordinance, 1969 (Ordinance No. XVII of 1969), the Commission hereby directs the Dhaka Stock Exchange Limited and the Chittagong Stock Exchange PLC, namely: -

1. The stock exchanges shall not entertain the equity securities with price-earnings ratio of above 40 (forty) as "marginable securities" under clause (d) of sub-rule (12) of rule 3 of the Margin Rules, 1999 and the stock brokers shall not provide loan facilities to their clients to purchase the said securities:

   Provided that the equity securities which remain at 'A' category for at least immediate preceding 3(three) consecutive financial years having current paid-up capital not less than BDT. 50 (fifty) crore with price-earnings ratio not more than 50(fifty) shall also be treated as "marginable securities" until further order.

2. The Commission's Directive No. SEC/CMRRCD/2001-43/42 dated June 15, 2010 and similar previous Directives are hereby repealed.

This shall have immediate effect.

By order of the Bangladesh Securities and Exchange Commission

(Signature) 18.4.23
Professor Shibli Rubayat-Ul-Islam
Chairman.

Securities Commission Bhaban, E-6/C Agargaon, Sher-e-Bangla Nagar Administrative Area, Dhaka-1207, Bangladesh Phone (PABX): +88-02-55007131-2, Fax: +88-02-55007106, Email: info@sec.gov.bd, Web: www.sec.gov.bd